Question

Sullivan Products manufactures candy. The company plans to manufacture 1,230,000 chocolate bars to be sold at $0.36. The fixed costs are estimated to be $109,900. Variable costs are $0.08 per unit. How many chocolate bars must be sold for Sullivan Products to break even?

Answer 1

___________________________________________________Break-Even Point Q = Fixed Cost / (Unit Price - Variable Unit Cost)

Q = (109000)/(.36 - .08)
Q = 389285.71
if you manufacture 389286 units you will break even ______________________________________________________